Tuesday, September 28, 2010

Parallel Universe: Change in Libraries For Publishers

As I mentioned last week I am speaking at the Supply Chain meeting at the Frankfurt bookfair next week. Here is the second part of my draft presentation. (Part one from last week).

The academic library has been forced to re-evaluate their activities for a variety of reasons.If we reference the changes made generally to accommodate a migration from paper to electronic materials, then the impact on monographs is really an anticipated progression of their change programs.

One important change initiative I would characterize as one of “efficiency”.As the thinking goes: “Are we as librarians delivering the appropriate services in the most efficient manner?”Whereas detailed cost analysis have always been possible, economic realities now enable solutions that previously may have been unrealistic for practical or political reasons.The life time costs of maintaining a monograph collection were always known to be expensive but limited alternatives to the open stack paradigm made real analysis irrelevant.With the rapid escalation in digitization programs and a collective approach to resource sharing, libraries now have viable options with respect to down sizing their monograph collections.This now defined expense coupled with the very real costs of real estate and development projects for new buildings has many university administrators salivating over all that “under-utilized” space.

Research conducted by Paul Courant and Mathew Nelson (The Idea of Order) explicitly documents the costs of maintaining a print monograph collection.The opportunity for publishers may rely on turning this analysis of the ‘life time cost’ of holding book into a sales opportunity for eBooks.The authors also calculate that a typical academic library could be spending about $1mm just to maintain their legacy print collection.In an environment where monograph usage is declining this large annual expense begins to look like an onerous and misguided use of funds.What response will publishers get if you ask libraries to – in effect – add to this annual expense by buying more print?

As I noted earlier, the case for a wholesale reevaluation of the idea of books in the library has gained credibility.As strange as it is to say, the physical book collection may not be needed.It may be both economical and efficient to remove them.Constance Malpas from OCLC goes a bit further when she comments that “books have already left the building” – with over 70mm volumes having been removed from local collections and placed in off-site storage.Some important universities have determined that they can operate with little or no diminution of service while reducing their on-site collections.(30% of Columbia’s, 40% of Berkeley’s, 50% of UCLC’s and more than 50% of Harvard’s).

Simply moving books off site, doesn’t represent a total solution.As the authors Courant and Nelson note, electronic storage in addition to or combination with physical collections is most optimal because access to an electronic version of a book aids in selection of the title.If a user is able to look at the toc or index or search the electronic version in advance of requesting the physical book then they are more likely to request from off site storage the books they really need.Large digitization programs such as Hathi Trust and others are beginning to support this type of “mixed platform” hybrid.

The Hathi Trust is one of several digital repositories.At Hathi, their mass-digitized collection is sufficient to replace at least 30% of most academic print book collections.Hathi grows daily and there are other repositories adding titles in a similar manner.All have a different collection profile and different partnerships but at some point these repositories will collaborate and weave together their collections so that the overlap or replacement potential across academic library collections will near 100%.

So what are we seeing here?Initially, I spoke about the cost savings from more efficient use of physical space and transitioned into discussion about shared repositories of content.These activities are closely related and will be progressively augmented and expanded with further network level services. In short, more sophistication will ensue concerning access, applications and services focused on monograph content that historically was disbursed in the extreme volume by volume and library by library.

Strategically, what might these initiatives mean for publishers?Libraries are not saying categorically they don’t want print but they are aggressively placing print content offsite.In some instances new books purchased are going straight to off site storage.In accessing these assets, the library also wants a digital copy that they can place in the catalog for search and discovery.The shared approach to collection management while currently reflective primarily of their retrospective print collections will become the paradigm for future purchases – both print and eBooks.Going forward publishers will be expected to accommodate this.While representing a challenge for both libraries and publishers there may be opportunities in working toward a new business model.Recall, that the combination of the ILL statistics and the Hathi stats on title overlap suggests – strongly – that supply and demand is significantly out of balance.Addressing this is just one opportunity.

This discussion would not be complete without also bringing in the migration to eBooks and eContent.It may be in the transition to an eBook environment where publishers and libraries will clash and it would be a significant mistake for book publishers to assume libraries are ignorant of the issues and complexities of eBook and eContent business models.

In fact, libraries may have a more experienced view of the eContent business models than do many book publishers.Libraries participated in the migration of information databases, print serials and journals to online databases and most importantly facilitated the radical improvements in the provision of serials content. Some see similar and perhaps greater opportunities as monograph make this transition.

But publishers see eBooks in libraries as problematic. There may be more acceptance of eBooks in the academic setting but thus far much less so in the public library segment. A recent report published by Chief Officers of State Library Agencies (COSLA) suggested that libraries seek to organize a national buying pool to source and negotiate eBook deals. We’ll see how far they get with that.

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Michael Cairns

Michael Cairns has served as CEO and President of several technology and content-centric business supporting global media publishers, retailers and service providers. He can be reached at michael.cairns@outlook.com and is interested in executive management and consulting, board and/or advisory positions. I am currently Managing Director with Digital Prism Advisors where we advise clients on digital and business transformation.

My career spans a wide range of publishing and information products, services and B2B categories and my operating and consulting experience has largely been with brand-name companies such as PriceWaterhouseCoopers, Macmillan, Inc., Berlitz International, AARP, R.R. Bowker and Wolters Kluwer.

I have served as a board member of the Association of American Publishers (AAP), the Book Industry Study Group (BISG) and in addition to my responsibilities at R.R. Bowker, l also served as Chairman of the International ISBN Executive Committee.